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October 23, 2018 at 1:59 am
Hi sir, If I received some cheques from some clients in September, I would debit the bank and credit the Receivables but I never lodge those cheques until October. Is those cheques recorded as cash in hand on the balance sheet? Or they are still apart of the bank but is recorded is added as outstanding lodgement on the bank reconciliation
John Moffat says
October 23, 2018 at 7:09 am
The cheques are entered in the cash account as received when the cheques are received. If they have not yet been paid into the bank, then they also appear on the reconciliation statement as outstanding lodgements.
October 23, 2018 at 11:29 am
Thank you sir, that is what I know and the auditor is telling me that they are cash in hand because they weren’t lodge until the following month. Thank you so much again.
October 23, 2018 at 11:44 am
And I know for a fact that cash in hand refers to coins and notes (paper money).
October 23, 2018 at 4:08 pm
In the financial statements we normally don’t show cash in hand and cash at bank separately.
With regard to what the auditor has told you – that is correct and is what I wrote in my previous reply.
The cheques received are entered in the cash amount when they are received and therefore do appear as an asset in the financial statements. If they have not been paid into the bank then they also appear on the bank reconciliation statement, otherwise the cash balance will not agree with the bank balance.
Have you watched the further lectures on bank reconciliations?
October 23, 2018 at 9:18 pm
Yes sir I did. However, the auditors do show Cash in Hand different from Cash at Bank on the balance sheet. Hence why I am saying it shouldn’t be shown as cash in hand because they use the cash in hand only for the petty cash.
October 24, 2018 at 9:10 am
Fair enough, although it is irrelevant for the exam 🙂
October 24, 2018 at 12:15 pm
Thank you so much sir for understanding. I do appreciate this and thank you for allowing me to understand too. I’m taking this exam in December.
May 26, 2018 at 2:41 pm
Sir is credit transfer credited in the cash book balance or not?
May 26, 2018 at 4:21 pm
If it is a payment by credit transfer then yes – we credit cash.
It is a receipt by credit transfer then we debit cash.
(The word credit in credit transfer is nothing to do with debits or credits – it is just another word for a bank transfer)
May 26, 2018 at 9:03 pm
right Sir but if question does not mention if it is payment or receipt so how will we treat credit transfer ? because i have been doing questions which do not mention of it being either payment or receipt
May 27, 2018 at 9:48 am
Exam questions will make it clear.
May 6, 2017 at 3:25 am
May 6, 2017 at 9:51 am
Thank you 🙂
July 24, 2015 at 7:24 pm
Sir, I just had a general question from this lecture. What is a Journal entry for payment of electricity bill through credit card? Do you open a new account for credit card or Credit bank account?
July 24, 2015 at 7:36 pm
Assuming that the credit card is one that sends a monthly statement to pay, then you would credit an account for the credit card. (Some credit cards take the money directly from your bank account, in which case you would credit cash).
However, as I do say in the lectures, credit card transactions are not examined in Paper F3. The reason is that we are looking at businesses, and although some businesses do use credit cards, in most cases they are used by individuals (who might then claim from the business).
July 20, 2015 at 10:07 pm
Just found the reason to be confident of finally getting going with ACCA. Great, engaging Lecturer. Excellent for self study 🙂
February 3, 2015 at 9:14 am
Sir, i have a doubt. The Foll. is a T- account- capital a/c. What should i understand when income statement is 400 and how do I know when to write this?
Capital a/c Drawings 100 Cash 5000 Income Statement 400 Balance 5300
February 3, 2015 at 9:59 am
In future please ask questions in the Ask the Tutor Forum – not as a comment on a lecture about something completely different 🙂
In the exam you can not be asked to prepare t-accounts – sometimes they are useful in your own workings, but that is really all. The amount owed to the owner (the capital) increases due to any profit (from the income statement) and decreases due to any drawings. That is all that is happening here. You should watch the lecture on chapters 2 and 3 of the Lecture Notes where this is all explained.
February 3, 2015 at 10:06 am
thanks so much Sir. I will make sure that qns are asked in the right place. 🙂
May 3, 2014 at 11:34 am
i would like to buy lecture videos for F4 to F7 for December session,and use course notes from open tuition.
kindly advise if i can buy.
May 3, 2014 at 1:23 pm
Our lectures are free of charge, but can only be viewed online.
November 24, 2013 at 6:47 pm
it realy helps thanks
September 11, 2013 at 12:41 pm
May 7, 2013 at 7:31 pm
January 2, 2013 at 9:56 am
Where was this lecture done?
September 30, 2012 at 2:34 pm
love the lecture!
September 9, 2012 at 3:01 pm
i have problum in solving bank recuncilation
August 4, 2012 at 5:02 pm
thank you sir
April 12, 2012 at 5:08 pm
so funny and interesting
April 9, 2012 at 4:35 pm
March 31, 2012 at 3:32 pm
February 14, 2012 at 5:07 pm
January 22, 2012 at 10:13 am
December 10, 2011 at 3:00 pm
Absolutely loved your rant about the cheques in Lithuania and the the American spelling of cheque! Bravo sir!
December 5, 2011 at 11:03 pm
November 22, 2011 at 6:34 am
Thank You Very Much 🙂
November 7, 2011 at 9:33 am
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